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Hyunda, Kia to strengthen separate identities amid cannibalization, growth

by Nat Shirley

Hyundai and Kia will try to carve out more distinct identities but will continue as direct competitors in many segments.

Sister companies Hyundai and Kia (known as Hyundai Kia Automotive Group) are in the unusual position of competing head-to-head in multiple segments. Despite the inevitable sales cannibalization arising from this state of affairs, each has enjoyed remarkable growth in recent years. separate

The precarious situation begs the question: should the automakers leave well enough alone, or try to differentiate themselves to appeal to different groups of buyers?

As in the past, the companies will continue to move forward with a strategy that encompasses elements of both options. Though some have speculated that Hyundai would do well to slowly creep upmarket, focusing on luxury offerings such as the Genesis and Equus while leaving the low end to Kia, the companies will instead continue to compete in the same segments (although Hyundai will be positioned as the more upscale alternative) and share mechanical components while distinguishing themselves through styling and marketing.

"The biggest differentiators will be design and future branding. Hyundai's brand will be more modern and premium and Kia will be more sporty," said a Hyundai executive who wished to remain anonymous due to the sensitive relationship between the companies.

"One of our group's biggest agendas is to differentiate Hyundai and Kia and minimize cannibalization," the executive said. "It is true that there is competition and cannibalization between some models of Hyundai and Kia."

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